CVR Energy, Inc. announced in a Nov. 2 news release a definitive agreement to acquire Gary-Williams Energy Corp. and its Wynnewood, Oklahoma, refinery and related assets for $525 million plus working capital, currently estimated at approximately $100 million.

The 70,000 bpd Wynnewood refinery will provide “an immediate and meaningful increase in the scale and diversity of CVR Energy’s refining operations,” said the company.

Inventory’s Still High But
East Coast Distillate Stocks Declining when Supply Building is Typical

East Coast distillate inventories peaked Aug. 26 before being drawn down by 4.7 million bbl through Oct. 28, representing an average draw of 75,000 bpd, 11% below the five-year average at a time when inventories normally build ahead of winter, according to This Week in Petroleum posted Nov. 2 by the Energy Information Administration.

“Distillate stocks in the Northeast, the nation’s largest heating oil market, typically peak in November, to help meet peak heating demand during the months of December, January and February,” EIA reported.

Wholesale refinery margins or crack spreads based on West Texas Intermediate crude oil have been climbing higher in 2011 than those based on other crude oils due to supply constraints, according to a report on crack spreads posted last week by the Energy Information Administration.

The 3-2-1 crack spread is the difference between the market value of the refinery input of crude oil and the two key outputs of gasoline and diesel fuel, weighted in rough proportion to their shares of production.